E6-22 Computing Target Profit, Preparing Contribution Margin Income Statement, Computing Margin of Safety [LO 6-2, 6-3] Erin Shelton, Inc., wants to earn a target profit of $920,000 this year. The company's fixed costs are expected to be $1,240,000 and its variable costs are expected to be 50 percent of sales. Erin Shelton, Inc., earned $820,000 in profit last year. Required: 1. Calculate break-even sales for Erin Shelton, Inc. Break-Even Sales 2. Prepare a contribution margin income statement on the basis break-even sales. (Do not leave any cells blank, enter a zero wherever required.) Contribution Margin Income Statement Contribution Margin Profit 3. Calculate the required sales to meet the target profit of $920,000 Target Sales 4. Prepare a contribution margin income statement based on sales required to earn a target profit of $920,000 Contribution Margin Income Statement Contribution Margin Profit 5. When the company earns $920,000 of net income, what is its margin of safety and margin of safety as a percentage of sales? (Round your "Percentage Sales" answer to 2 decimal places. (i.e 1234 should be entered as 12.34%.)) Margin of Safety Margin of Safety as a Percentage of Sales %